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India Must Spend $250B by 2019 to Meet Its Power Needs

If India is going to provide power to its more than 1 billion people over the next five years, it will need to invest about $250 billion during that time, according to Reuters

The country’s power minister, Piyush Goyal, speaking at the World Economic Forum conference in New Delhi this week, noted that most of the money would need to come from the private sector.

The government is seeking $100 billion for renewables and $50 billion for transmission and distribution upgrades, according to Reuters. Earlier this year, the government committed $250 million to solar plants, solar-powered irrigation and power upgrades.

India is having difficulty meeting its current power demands, and it will be a stretch to supply reliable electricity to a power-hungry nation that is slated to double its energy consumption by 2019. Nearly 40 percent of India’s 1.2 billion residents do not have access to reliable electricity, a gap that President Modi has pledged to eliminate in the coming five years.

Much of that demand will ultimately be met by burning more coal. Goyal said India needs to increase the amount of coal it mines, while also cutting down on theft and investing in renewables. Coal already produces more than half of the country’s electricity.

Although coal will continue to reign in the country, Goyal claimed earlier this year that India will be a “renewables superpower,” according to The Guardian. He suggested India could easily add 10 gigawatts of solar annually. Last month, the government approved the nation’s first offshore wind farm

There are many factors that could derail those solar ambitions, however. “The problem isn’t the level of investment; it’s the way that investment is being structured and directed,” said Adam James, global demand solar analyst with GTM Research. “The government has earmarked funds to develop several gigawatt-sized solar plants to meet its ambitious solar targets. That exposes India to a higher risk of not meeting its targets.”

James noted that projects of that size face considerable challenges in terms of project development, including securing land, offtakers, financing, grid connection and management. Even so, “the National Solar Mission has been a success,” said James, “and we are seeing a resurgence in state markets and unsubsidized growth in distributed generation.”

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Bas Gresnigt's picture
Bas Gresnigt on Nov 11, 2014 4:28 pm GMT

PV-solar is developing fast in India. Even amid the high mountains in northern Kashmir.

Bas Gresnigt's picture
Bas Gresnigt on Nov 12, 2014 12:33 am GMT

That is ~114GW av. = the installation rate of renewable (hydro, solar, wind, etc).
With av. CF of 30% (incl hydro, biomass, geo-thermal, etc) that implies ~3 times higher installation rate and all new installation is renewable. So just two decades.
Remember that 10years ago solar and wind were nowhere…

German installation rate of PV & Wind
The Energiewende scenario is a grow of renewable from 6% in 2000 towards >80% in 2050. That is 1.5%/a. With an av. consumption of ~60GW, it implies that installing 1GW/a with CF 90% is ~ enough.

The present smart installation corridor delivers ~5GW/a wind+solar. With av. CF of 18% that is already enough to reach the target. Other renewable are also increasing somewhat; biomass, geo-thermal, hydro, etc.

The years with the high PV installation rate deliver the Germans an edge, so the intermediate target for 2030 was increased last autumn from 50% towards 55-60% renewable.

Of course the Germans could continue to install 7GW/a solar, put that would increase the Energiewende levy more which would cost support of the population. And that support (now ~90%) is critical for its success! As it is a 50years scenario it’s support should be (and is) undisputed.

Remember that PV costs go down with ~8%/a, so same capacity installed in 2022 will cost half. So then no feed-in-tariff needed as it will be profitable to install anyway (even if only 30% is consumed by the owner). Hence decreasing Energiewende levy! 
So speeding up may win a few years but may be risky regarding public support. And such speeding up does not lower the prices much as the word market is huge by now.

It is better to subsidize investment in solar batteries and create market volume for that, in the hope that such market volume will also imply great price decreases. So they have now a new subsidy program that does that.

Bas Gresnigt's picture
Bas Gresnigt on Nov 12, 2014 1:27 pm GMT

Even in US now: CBS announces: “during the first half of 2014, 53 percent of all new electric capacity was from solar power.”.

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